Saksoft Limited (SAKSOFT) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the SACSoft Limited Q2 FY27 Earnings Conference Call, hosted by Monarch Network Capital Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference, please signal an operator by pressing star-bend 0 on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vinay Menon from Monarch Networth Capital Limited. Thank you, and over to you, sir.

Hi, good afternoon, everyone, and thank you for the opportunity. I welcome you to Saksoft's Q2FI 27 earnings call. With us, we have the senior management of the company. We have Mr. Ajitya Krishna, who is the managing director of the company, Avantika Krishna, who is the executive director, and Mr. Neeraj Kumar, who is the CEO and CFO of the company. Now, I hand over the call to Mr. Ajitya Krishna for your opening remarks. Thank you.

Thanks, Vinay. Good afternoon, everyone, and thank you for joining us for SACSOFT's Earnings Conference call to discuss our performance for the second quarter and first half of financial year, 2027. I hope all of you have had the opportunity to review our financial results and investor presentation. I will begin by sharing the key business and operational developments during the quarter. Following which, my colleague, our Chief Operating Officer and Chief Financial Officer, Mr. Neeraj Ganariwala, will take you through the financial performance in greater detail. The tech services industry continues to undergo a significant transformation, with the demand environment remaining selective amid macroeconomic uncertainties and cautious client spending. While clients continue to exercise greater discipline over discretionary technology budgets, spending on strategic priorities such as artificial intelligence, cloud modernization, data analytics, cybersecurity, and automation remains encouraging. We are also witnessing a gradual shift from AI experimentation towards enterprise-level implementation. Creating opportunities for technology service providers with the right capabilities and domain expertise. At the same time, increasing AI-led productivity is reshaping traditional delivery models, making innovation, execution capabilities, and the ability to deliver measurable business outcomes increasingly important. During the first half of financial year 2027, the industry continued to witness uneven demand across sectors and geographies. We believe this environment presents opportunities for specialized technology partners that can offer greater flexibility, deeper customer engagement, and focused digital transformation solutions. At Saksoft, we remain focused on strengthening our capabilities and deepening our relationships with existing customers. Our investments in artificial intelligence and proprietary accelerators are aimed at improving delivery efficiency. Enhancing our technology offerings and expanding wallet share across our client base. We continue to leverage these capabilities to address evolving customer requirements and position ourselves for opportunities arising from the growing adoption of AI-led solutions. During the quarter, we further strengthened our leadership team with the appointment of Mr. Gurmi Chahal as Chief Executive Officer. He brings extensive experience in scaling digital businesses and taking a technology company through a public listing. His appointment is an important step in strengthening our leadership capabilities in the U.S., Europe market, and supporting Saksoft's next phase of global growth in an increasingly AI-driven environment. Although revenues in the second quarter remain broadly flat, Compared to the first quarter, we continue to make progress in transforming our business with an AI-first approach. We are proactively engaging with customers through free proof of concepts and leaner team structures, helping them drive greater efficiency through AI across their workflows. While this may result in some revenue cannibalization in the short term, we believe it will strengthen our position as a co-innovation partner and create greater opportunities over the medium to long term. Looking ahead. We are confident of delivering a stronger performance in the second half of this financial year compared to the first half. With that, I would now like to invite Irish to take you through the financial performance.

Let me now take you through the financial highlights for the second quarter and first half of the financial year 2027. The revenue from operations for the quarter stood at around INR 249 crores, remaining broadly in line with the previous quarter. The EBITDA stood at around INR 44 crores, declining 4% quarter on quarter, with the EBITDA margins moderating by 66 basis points, To 17.6%. On the other hand, the profit after tax increased by 10% sequentially to around INR 32 crores with the profit after tax margins improving by 114 basis points to 12.92%. For the first half of the financial year 2027, the operating income stood at INR 497 crores, registering a marginal year-on-year decline of 2%. The operating EBITDA declined by 8% year-on-year to INR 89 pros with the EBITDA margins being at 17.93% contracting by 107 basis points. The profit after tax stood at INR 61 pros with the profit after tax margins at 12.35% which is down by around 111 basis points year-on-year. The revenue mix for the first half of the financial year 2027, U.S. continued to remain the largest market contributor with 51% of the total revenues coming from U.S., followed by Europe at 28%, and APAC and other regions accounted for the remaining 21%. From a delivery perspective, the on-site and offshore revenue mix stood at 43% and 57% respectively. Reflecting a continued focus. Our revenue base remains diversified across industry verticals, with the banking and financial services contributing 30%, the emerging verticals accounting for 45%, the logistics contributing 16%, and the digital commerce accounting for the remaining 9%. Turning to some customer metrics, we continue to have 16 clients generating an annual revenue of USD 1 million, of over USD 1 million each. Our top 5 customers contributed to about 40% of our revenues, the top 10 58%, and the top 20 clients contributing to about 72% of our total revenues. Our employee strength stood at 2,393, comprising 2,203 technical professionals and 190 support staff. Employee utilization, excluding trainees, remained healthy at 84%. The net cash, after excluding long-term and short-term debt, increased by around INR 95 crores as compared to year-on-year and stood at INR 244 crores as on 30th September 2026.

Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to please use handsets when asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question comes from the line of Kanishka Gupta with SS Family Office. Please go ahead.

Hi, very good afternoon. I wanted to ask that given Saksoft's ambition of achieving USD 500 million in revenue by 2030 and considering the current TTM revenue of approximately 1000 crores, so the company would need to deliver revenue care of approximately... Thank you very much. 39% to achieve this target by FY31. So, can you provide a bit more clarity on the expected contribution from organic growth versus inorganic acquisitions while achieving this target?

Yes, it seems a mammoth target and a goal at this point. However, a few quarters of really good growth can change the story, and that's what we are working on. We are working on a few non-linear options. That includes M&A, which you mentioned inorganic, but also... Pull from partnerships, you know, an area where, you know, we have traditionally been weak. Our new CEO is putting a lot of focus on pull strategy in addition to the push strategy, which is predominantly partner pulls. And also, you know, multiple campaigns running at the same time, you know, to improve the demand scenario that we have. So, yes... Very honestly, it seems a huge target. As of today, we are confident that, you know, we'll be able to get close to the 500 million, if not at 500 million. We have to demonstrate much more growth than we have in the last four quarters, which have been predominantly flat. And we are making the right investments. You've seen the investment in leadership. Last 12 months, we hired a chief growth officer for the US geography. Last four months, we hired a chief growth officer for the UK market. And now we've got a new CEO who joined us about three weeks ago, who's got a lot of experience in scaling businesses. So we feel we have the foundation. We've had a few bad quarters or flat quarters, and we've invested for the growth that we expect to come. And as of today, we are confident we'll get there.

So, how confident are you that internal cash generation will be sufficient to actually fund the planned acquisitions without compromising any kind of financial flexibility and returns on the invested capital?

If you look at our history, we've always managed to fund acquisitions, and we've done quite a few of them, through our own cash. We've taken a little bit of debt occasionally, but it's predominantly been through own capital or own cash, as well as a structured payout, which has worked well for us. We plan to continue with that approach. We're not going to dilute capital very clearly. We're not going to take excessive debt. And with our experience of over eight acquisitions in the last 10 years, We are very confident we have a robust model in place to look at inorganic targets.

Yeah, so secondly, I would like to ask that the Q2 performance was largely expected to remain muted. So, how is the visibility for H2 now, and how confident are you about the meaningful recovery that we can expect in the second half, considering the current order pipeline and outlook?

Second half will definitely be better than the first half. Now, that's not saying much because the first half has been flat. But you will see improvement in performance quarter by quarter. We're very confident of that. And we already have almost 50% of quarter three is over. So, we've got a good handle on quarter three. You will see better results starting this quarter.

And what would be the pipeline as of now?

The exact quantum of pipeline I don't have with me, but if you share your email, we will send it to you.

Sure, no worries. And are we still going forward with our 1200 crores of guidance for FY27 revenue? If so, that would actually imply to approximately a 40% YOY growth in H2.

Yeah, like I mentioned, we're looking at a few non-linear options. If any of them kick out or work for us, it could significantly get us. Do that figure. You know, it's a tough ask today. I appreciate that because of the last two quarters. But, you know, in this business, like in any other business, the cost always comes before the results and the revenue. So we made the investments. Now we have to be a little patient and wait for the results.

Got it, sir. And lastly, I would like to put in one more question. And what would be the key milestones one should track over the coming quarters to assess progress towards the longer term objective of 500 million revenue ambition?

I think the only figure you should look at is top line growth. Because in this business, if top-line growth happens, and EBITDA is maintained, and even if EBITDA is compromised a few basis points, it will catch up. So I think the only metric to really look at is top-line.

Okay, sir. Thank you very much. That's it from my side and all the very best for the future.

Thank you.

Thank you. Our next question comes from the line of Vikas S with RBC. Please go ahead.

Thank you. Aritia, my question on if when you say... Push strategy, does that also entail capital expenditure? That's not necessarily equivalent to M&A. That was my first question. And B, if nothing fractifies in this financial year, in terms of regular organic growth, what are we looking at in the second half, if there is a range?

The first question, Vikas, is on... So, to me, nonlinear is basically two buckets. One is the inorganic, which is an M&A, where obviously we need capital. The other is a partnership pull. You know, we have strong partnerships with ServiceNow or Salesforce. We have never capitalized on that pull. And that's what we are focusing on. And our new CEO has a lot of... The experience in that area. So if any of that starts kicking in, and it will kick in, it's just a question of when and how quickly, that does not require capital. Because those capabilities we have, it's just we will start getting a lot of business through the partners, which today we don't get. So that's the first part. Second question, if nothing rectifies, second half will definitely be better than... First off, we are probably looking at somewhere around 1100 crores.

Got it. Thank you. I'll get back into the queue.

Thank you. Our next question comes from the line of Rushabh with RBSA Investment Managers LLP. Please go ahead.

Hi, sir. Thank you for the opportunity. So, firstly, we have an ambitious target that will set for ourselves, and I believe a significant part of the growth will come from gaining more wallet share from the existing customers. I just want to know what are the two, three things that have been done in the last one year or so that will enable us to gain more market share? To share some anecdotes and qualitative examples will be very helpful to understand.

I think the biggest thing you must take into account is that we are transforming our business in two broad areas. One is leadership and deeper management depth. And I mentioned that in terms of leaders in the US and Europe geography, and also now a new CEO. So that is one area. The other is, we are transforming to become an AI first digital transformation partner. Now, what do I mean by that? Going to our customers proactively and saying, the work we're doing for you, we can do it more efficiently with leaner teams using AI. Before somebody else does, and before the customer realizes that we are still stuck in the old ways of doing things. So, as an example, going to a customer and saying, look, right now we have a 50-member team working with you. We are now going to use AI and make this 50-member team a 30-member team. You know, and we will deliver better value, more efficiency for you. Customers happy? Yes. In the short term, we have some revenue cannibalization. In the long term, medium term, we will definitely benefit because customer will see us as a true partner. It will see us as a co-innovator in their business, and we will get more business. Some of it we can drive through better price realization, but... In the short term, revenue will take a little bit of a hit.

So, as we are, you know, shifting and pivoting models to outcome, more outcome-based models, is that a customer stickiness, once you have accepted level, certain level of trust, is it more stickier than the ideal model? How does the customer dynamics work in this outcome-based? What is your understanding so far?

Outcome-based is definitely stickier than people-based because at the end, You know, people can be in-source, people can be hired, people can, you know, there can be attrition. So, outcome-based, where we own the outcome and customer depends on us for outcome is clearly stickier and more, you know, long-term oriented for us. And it bodes well for our future revenues.

In internet, the margins also should improve, right? Since it's a more personalized and customized work. Eventually, in the long term, margins should be much higher than what we are today.

Margins will be higher because of, one, better pricing, and more importantly, reduced workforce.

Okay, okay. And so, what is the biggest shift you see to achieving this target in the current geopolitical scenario? And if you can...

Can you repeat that question? Can you just repeat the last part of your question?

I'm just asking, what is the biggest risk you foresee in the current geopolitical world? And given that in that volatile world, we are already pivoting toward different models. So what is the one biggest risk you foresee for your business?

You know, I don't think Saksoft has any perceived risk which the entire industry doesn't face. And I think the biggest risk that all tech companies, tech services companies face today is the impact of AI and the maturity of customers and the willingness of customers to adopt AI. You know, and that is no, there is no one clear. Answer to that question. We will have to adapt. More importantly, we will have to transform, which we are working on proactively. So, honestly, I don't see any specific risk for SACSoft vis-a-vis the industry.

And just the last question, sir, you mentioned that about customer acceptance. So, has the customer acceptance, at least for our customers, the journey has been from pivoting to giving more? What is the tech force? How is that journey? Where are we in that journey? In terms of AI adoption?

Customers are now moving from experimentation to actually using AI for their enterprises. We are clearly in the front of the queue. One, because we are in their faces. We are present in front of them. And secondly, because of the accelerators, the platforms that we have in AI. So, we are well positioned from that perspective. Now, it's too early because these things don't happen overnight that, you know, we are seeing immediate wanted share results, but we are very confident we will. It will take time.

Okay, thank you, sir.

Thank you. Our next question comes from the line of Vani with Alpha Advisors. Please go ahead.

Yeah, hello. So, I can see some weakness in retail as a segment. So, did we lose a client or something?

We didn't lose a client, but a few projects with existing customers came to an end. That should pick up.

Okay. And can EBITDA margins return to the 19-20% range over the next 2-3 years, or should investor factor in structurally lower margins?

Next 2-3 years, definitely it can. It won't happen in the next two quarters because of investments in basically sales and leadership. And the fact that we are moving towards the outcome-based model, but two to three years, definitely it can.

Thank you. Our next question comes from the line of Dhruvind Kadakya, an individual investor. Please go ahead.

Hi, good afternoon, sir. I had a couple of questions.

Sorry to interrupt you, Dhruvind, but your line is sounding muffled. I request you to please check the mode that you're using on your device.

I just wanted to understand that how do we look at our employee cost going ahead since we've hired some senior people, so do we see that as a dent in our margin?

Ruben, this is Neeraj here. Like Aritya mentioned, we are investing in some leadership, so you know, and cost comes ahead of the revenue. So initially, yes, there could be some minor impacts, but with these investments and costs, the revenue will also go up. So it should stabilize, but maybe for the next one or two quarters, there could be a slight impact.

And right now, the current weakness that we may experience, is it because of, let's say, project delays or low utilization or any loss of market share, like any particular reason we would want to pinpoint to?

Sorry, can you repeat that question?

I'm saying that right now, the current weaknesses that we may experience, is it because of, let's say, discretionary spending cuts or project delays or low utilization, some particular reason that we can highlight?

I think the only thing we can say is that a few of our customers have insourced work or are in the process of insourcing work. Now, it doesn't mean that we're eliminated as a partner. It means some of our work goes to a captive that they are building in India or somewhere else in the world. So that has impacted us. Those are temporary, you know, sort of blips, you know, which we will be able to overcome as we move to the outcome-based model and as we use AI to improve our capabilities and our delivery models.

Understood, sir. Thank you so much.

Thank you. Our next question comes from the line of Girish with Kseema Wealth Private Limited. Please go ahead. Hello, hello, I'm audible. Yes, you are audible. Please go ahead.

Thanks for the opportunity. I had a few questions on the DI thread, actually. So, the manager has said, you know, the DI productivity and efficiency game is around 30 to 50%.

Sorry to interrupt you, Girish. Yeah, we can hear you, but it's not coming to clearly.

Just a second. So, you know, you have previously stated the productivity efficiency gains were around 30 to 30 percent in product engineering and 20 to 30 percent in managed services. I just want to know, do these numbers still host? And also, how does the air declination impact look like? If you could, you know, add a number to that, that would be really nice as well. And are we able to offset that declination as we know?

If I understood your question correctly, because the line is not that clear, you're talking about efficiency gains in product engineering as well as in managed services. And the numbers you have quoted are pretty much accurate. Now, what does that mean? In the short term, it means revenue cannibalization. And that's what we are experiencing. And we are proactively going to our customers and saying, look, we can do things better using AI. The objective is that over the medium term, not only will our spending with that customer come back to the original level, it would increase because the customer will see us as a true partner and a co-innovator. But in the short term, we get hit. Now, that's the... Disadvantage of us being a smaller company in this industry. The big guys, the tier ones and the tier twos are able to manage it because they have sufficiently large multiple contracts. Some are evolving, some are not evolving. So they're able to offset that. In our case, you know, we have $16 million customers. We have to go to them at the same time. We can't say we'll do in this quarter four and then we'll do next quarter another four because if we do that, the chances are or the likelihood is somebody else will go to them with the disruption and we will lose that customer. So we have to go to all of them, which means maintaining revenue is a challenge by itself. And we have done a really good job because... With reduced revenues, we've been able to at least maintain our revenues quarter-on-quarter, which means in reality we are growing, but it's not showing in our results.

All right. So any clear number that we can put to AI declaration as of now?

AI what? Sorry, it's very unclear.

AI deflation, you know, any contract rate cuts that the clients do in AI just now?

So there are no rate cuts. There are revenue cuts because of efficiency of AI. We are offsetting a part of it by higher rates, but those are not. So for example, if there is an efficiency gain of 35%, or let's say just for argument's sake, 40%, that means my team size will go 4 on by 40. 40%. I can't offset it by increasing prices that much. So in the short term, I will lose revenue. And that's what's happening to us in terms of cannibalization. But we will make it up because customer again will see us as a true partner and give us more work.

All right, thank you. And also, this was a question. So, the 1,250 Kru guidance for FI27 still holds, right? The management is pretty confident.

Yeah, we are working on a few non-linear options. If any of those click, you know, we should be able to get to a number close enough.

All right, thank you. Thank you so much.

Thank you. Ladies and gentlemen, to ask a question, you may please press star and one. Our next question comes from the line of Divan Shah with Eternal Limited. Please go ahead.

Yeah, hi. So, firstly, thank you so much for the opportunity. And I just have a couple of questions so you can stop me if it's a lot. But yeah, so what are the service lines that you're currently seeing the strongest client demand from? So, like, just to understand on the demand side, and have you seen any meaningful shift for the revenue contribution amongst these lines? So, be it digital engineering or data analytics, cloud and testing?

I'll ask Avantika to answer that.

Yeah, so we're seeing a lot of traction in the engineering space. I think that's number one, and we're also seeing a lot of traction on the operations front, some managed operations, be it infrastructure or application support. So that's where our pipeline is increasing. And it also means it's a two-, three-year, or sometimes even five-year contracts with operations. With engineering, you know, it ends up being one-time projects, or it could be extension or maintenance of that development project. But these are the two areas that we see most amount of work coming in.

Got it. Okay. So just understanding on my second one. So the US is contributing, I think, approximately 51%, and you can correct me if I'm wrong, for the H1FR27 revenue. So are you expecting this contribution to remain sustainable? And what is your personal medium-term target that you would want to come out with for this particular geographic diversification?

So, we want U.S. to grow. That's the plan. The focus is U.S. geography along with U.K. Europe, but we feel the plan to grow U.S. is quite strong, and we want to see it at least 55 percent, you know, in the near term.

Got it. And just to follow up on this before I move to my next question, but just to follow up, what are you making of the recent changes in whatever is happening on the political front in the U.S.? Is it going to help us or are we seeing the stability or any downside?

We feel it will definitely help. It will also help in terms of, you know, decision making. I think, you know, people will be, in the US at least, people will be a little bit more relaxed and decision making will be quicker and faster on that front. So I think it will help.

Also the speed of development in AI will slow down because Democrats will insist on putting more guardrails and safeguards. So the rapid progress of AI will stop, which will mean customers will be in a better position to make decisions. One of the reasons they hesitate to make decisions is there are too many moving parts. Things are changing too rapidly, and they are scared to make a decision which will be no longer relevant six months from today.

Noted. That makes sense. And just beyond moving from US and Europe, what markets are you expecting to offer the most opportunities for our company? And are you planning to strengthen any sales presence in APAC region?

To your second point, there's no plan right now for APAC leadership. However, we do want to increase our presence in global capability centers in APAC. That is something that is untapped for us today. Although we work with a few GCCs in India, it's never been a focus of ours, and that has changed now, Especially now with Gurmeet coming on, he has a lot of experience with GCCs, and I think that's something that we would like to focus on in APAC. But these are the three geographies that we want to concentrate on, APAC, UK, Europe, and US. There won't be any additional geography at this point.

Okay, got it. Just to follow up on this, if you could, no pressure, but in APAC, are there any particular regions?

It's mainly in India and in Singapore.

Got it. Okay. Thank you. And one last question, then I can end it from my side. What is the share of revenue that is outcome-based today? And I think it was somewhere around 10% last year. And where do we expect this to stay in the next three to four years by FI 28-29?

So, it's definitely increasing. I think a measure that we use is also how many of our customers really interview people. You know, that's how, you know, we also sort of measure it, because that way we are in control of the, you know, the project or the outcome. And that we are seeing growing. We're actually seeing a big number increase over there. So we are seeing definitely more increase in the outcome. Number when we can get back to you.

Okay, sure. Thank you so much. That's it from my side. All the best for the future.

Thank you. Our next question comes from the line of Vikas S with RBC. Please go ahead.

Yeah, hi. I would say, you know, we were at about 25 million pipeline, while we don't have a specific number. How has it been this quarter? And are we also assuming now that there is some pace in conversions from pipelines to actual contract? That is what we were, you know, really challenging in the last quarter.

Vikas, honestly, we've had good conversions in the UK and Europe. The pipeline in the US has not been materializing at the pace at which we would have liked or expected. There are various reasons for it, and I think the biggest reason is the rigor at which we were following through on conversion. One of the reasons for having a CEO who's based in the Northeast is that to have personal rigor, personal follow-up to make sure this pipeline converts, which is why I'm confident that the second half would be better than the first half, because the pipeline is very much there. It's just not converting, more so in the U.S. than anywhere else, and that has to change. It's not that the pipeline has disappeared or anything has fallen off. It's just not converting at the speed that you want it to. And I think it's not something I can blame anybody else other than ourselves. We need to have more rigor. And with Kourmet joining and physically being present there in the New York region, it will help.

Got it. And any more key hiring in the pipeline and any attrition in the last few months at the sales and senior leadership level?

Nothing at the senior leadership level, but sales, yes. We have had to, you know, we have had to get, you know, one client partner to leave and a new one has been replaced. So you will see. And not so much in Europe, but you'll see a fair amount of change in client partners in the U.S. geography because we will bring new talent, talent which is more relevant, and we will have to let some old talent go. That's one. And there will be investments in the sales front end in the U.S. If I look at today, our sales cost as a percentage of our total, we are at roughly 3%, which is very low compared to most organizations of our size. We want to take it out. We'll do it in a paced manner, as we see better quarters, quarter on quarter. So you will see more investment. I hope that answers your question.

It does. Thank you.

Thank you. Our next question comes from the line of Kamal Singhania with Lotus Capital. Please go ahead.

Hello, sir. Thank you for giving me the opportunity. I joined the call late, so sorry if I'm being repetitive, but my first question is that growth has remained relatively slow over the past few quarters. And what are the few key factors that could drive recovery in growth going forward? And how is the overall demand environment setting up in the current quarter and quarters going forward?

So I've already answered that. I encourage you to listen to the recording.

Okay. Okay, sir. Thank you. And the next question is, like, at this stage, you know, where you're facing greater challenges, like getting additional business from existing customers or acquiring new clients? So, what steps are being taken to address these challenges and accelerated growth?

We are in a difficult demand scenario, and all efforts have been made through aggressive sales efforts, as well as we are focusing on a pull strategy, partnerships driving revenue growth, to get us back on the growth trajectory. Thank you.

And my last question is that how you are managing competition from the large IT service provider, particularly in the mid-size deal? So are you seeing any impact from vendor consolidation and all?

No impact from vendor consolidation, but we see competition from the tier 1s and the tier 2s because we are also starting to focus on the mid-size. But honestly, we are much better positioned. Than a larger company. For the simple reason, we are more flexible, you know, more adaptable. Customer sees us as more responsive. We can give more attention to these customers than a much bigger company. So I don't see great challenges there. The issue is, can we get in front of enough deals? You know, and that's where the demand side comes in. And that's where our focus is.

Perfect. Thank you. Thank you. That's it from us.

Thank you. Our next question comes from the line of Rushabh with RBSA Investment Managers LLP. Please go ahead.

Yeah, I just had one question. We just shared some data point on, it is for the top 10 clients. What will be the average market share and what was it three years back? Another wallet share in that client, I meant, sorry.

We'll have to get back to you on that. I don't remember off the top of my head.

My pleasure. Over the last three years period, it would have improved significantly, right? Is that the understanding?

Can you repeat that? Sorry?

Over the last three years period, it would have improved significantly. Our wallets are in the top ten clients.

Yes, for sure.

Okay, okay. Thank you.

Our next question comes from the line of Anupam Bide with Saksoft Ltd. Please go ahead.

Hi. What percentage of your revenue comes from AI projects, and how do you define those? And I don't mean AI for coding. I mean AI implementation, building agents for enterprises, etc., etc.

Anupam, can you just clarify from which firm are you?

We are from a family office, the BDA family office.

Okay, okay, because I think the moderator mentioned something else, so we were just trying to get clarification.

Yeah, okay. Just repeat your question again, please.

What percentage of your revenues comes from AI-related projects?

So, define AI-related projects.

Well, you come up with your definition, right? Because you must be measuring it like all companies today because that's the only way of growing today.

So, my answer would be 100% because there is no project we do where there is no AI.

Okay. Yeah, but that's not a very good answer. Basically, these are projects, if AI did not exist, would these projects be done? That would be my definition.

So that's why I ask you your definition. Honestly, there is no project today which is being done because of AI only. Every project is being done with AI. Whether it's product engineering, whether it's data, whether it is managed services, whether it's infrastructure, whether it's cybersecurity, there is nothing without AI. So anybody, you know, a lot of these tech companies are saying, I have so many AI projects. I mean, you ask yourself, what do they mean by that? Is that a project which is only AI? What is only AI? Can you do anything with only AI? Okay. I mean, after all, what's the endgame? Endgame is either you're building an application, you're doing some legacy modernization, you're doing an infrastructure project. So what's the endgame? It's not building an LLM, right?

No, I'm talking about projects that were specifically started because an enterprise's old applications did not include AI, and now they understand the potential of AI, and they're using it. Or a product company's products did not include AI, and because of AI, they are changing the product, putting AI into the product. So, these would be my two definitions. As I said, I don't mean AI for software development.

So, just to clarify also that we've got about 50% of our work coming from product engineering and platform engineering. And all the product engineering and platform engineering work that we're doing is AI. Any of our customers today are only thinking about AI and how they position AI to the market. That would mean that we will have to work on their products which are AI-ready. That is why we mean 100% is. All the operations work is also AI-driven because we have to bring down ticket volume, ticket data. And by doing that, we need to use AI. So in that sense, AI is in everything that we do.

Okay. Okay.

I'm sorry to interrupt you. I request you to please rejoin the queue if you have any further questions. Thank you. Our next question comes from the line of Vikas S. with RBC. Please go ahead.

No, no. Sorry. I appreciate it.

Ladies and gentlemen, if you wish to ask questions, you may please press star and one. We have no further questions at this time, ladies and gentlemen. I would now like to hand the conference over to the management for closing comments. Over to you, Seth.

Thank you all for joining us today and for your continued interest in SACSOFT. We appreciate your time and thoughtful questions, and we hope we have addressed your queries satisfactorily. Should we require any further information or clarification, please feel free to reach out to us or our investor relations advisors, Valorim advisors. Thank you once again, and wishing you all a very happy divani.

Thank you. On behalf of Monarch Network Capital Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.